SA drug firms, govt seal price deal

JOHANNESBURG – South Africa’s pharmaceutical industry has hammered out a compromise with health ministry officials on a controversial plan to slash prices to consumers, an industry source said yesterday.

The deal is expected to save consumers up to three billion rand a year in Africa’s biggest drug market, the source told Reuters. Under the compromise a planned 50 per cent blanket reduction in list prices would be substituted by price cuts on a company by company basis, said the source, who was involved in talks with the ministry.Firms would be audited over a 90-day period to determine how much prices had been inflated to accommodate discounts and bonuses to distributors and pharmacies.”We agreed to look at the pricing history company by company and reduce prices accordingly,” the source said.A ministry official confirmed that the draft regulations had been amended following consultations with the industry, but declined to give details ahead of their release early next week.”I cannot say what we have arrived at, but I think it is very well balanced between what we want to achieve and what the industry feels is appropriate,” said Humphrey Zokufa, cluster manager for pharmaceutical policy and planning.Drug prices are a sensitive issue in South Africa, which suffers the world’s highest case-load of HIV-AIDS, with an estimated 5,3 million infected out of a 45 million population.-Nampa-ReutersUnder the compromise a planned 50 per cent blanket reduction in list prices would be substituted by price cuts on a company by company basis, said the source, who was involved in talks with the ministry.Firms would be audited over a 90-day period to determine how much prices had been inflated to accommodate discounts and bonuses to distributors and pharmacies.”We agreed to look at the pricing history company by company and reduce prices accordingly,” the source said.A ministry official confirmed that the draft regulations had been amended following consultations with the industry, but declined to give details ahead of their release early next week.”I cannot say what we have arrived at, but I think it is very well balanced between what we want to achieve and what the industry feels is appropriate,” said Humphrey Zokufa, cluster manager for pharmaceutical policy and planning.Drug prices are a sensitive issue in South Africa, which suffers the world’s highest case-load of HIV-AIDS, with an estimated 5,3 million infected out of a 45 million population.-Nampa-Reuters